(By Balachander) U.S. stocks ended the first day of the fourth quarter on a mixed note, trimming earlier gains, after remarks by the Federal Reserve chairman Ben Bernanke. Stocks rose in early session after a data showed that activity in the U.S. manufacturing sector unexpectedly expanded last month.
The S&P 500 Index added 0.26 percent to finish at 1,444.48. The Dow Jones Industrial Average gained 0.58 percent to end at 13,515.04. The Nasdaq Composite Index slipped 0.09 percent to close at 3,113.53.
Speaking at the Economic Club of Indiana, Bernanke defended the central bank's third round of quantitative easing, saying the Fed's latest actions were needed due to slow growth.
The Institute for Supply Management's manufacturing index for September expanded to 51.5 from 49.6 in the prior month, for the first time in four months, while economists expected a a reading of 49.7. A level above 50.0 indicates industry expansion, below indicates contraction.
A report from the Commerce Department showed that construction spending in the U.S. unexpectedly dropped in August to 0.6 percent, versus expectations of a rise of 0.6 percent.
The other economic data likely to be in focus in the coming week are indicators of labor market, including ADP's private sector employment report, the weekly jobless claims data and Labor Department's non-farm payrolls data.
In global news, manufacturing indexes in Europe and China showed continued contraction.
Hot Stocks Of The Day: GS, CRDN, JAKK, BMC, TRW, GNRC, ANH
In corporate news, Goldman Sachs (NYSE:GS) advanced 2.80 percent after a Barron's report suggested that the bank's shares could rise 25 percent in the next year.
Ceradyne Inc. (NASDAQ:CRDN) surged 43.14 percent after the maker of ceramic products agreed to be bought for $35.00 per share, or roughly $860 million by 3M Co (NYSE:MMM) at a premium of 43 percent.
BMC Software Inc. (NASDAQ:BMC) added 3.27 percent. Wall Street Journal reported that that the company is considering selling itself and BMC has hired Bank of America Merrill Lynch to explore a possible sale.
JAKKS Pacific Inc. (NASDAQ:JAKK) fell 3.91 percent after the company slashed its outlook for 2012, blaming disappointing domestic product sales, a slowdown in product orders and higher expenses.
TRW Automotive Holdings Corp. (NYSE:TRW) jumped 7.71 percent after the supplier of automotive systems said it has authorized a $1 billion share buyback plan.
Generac Holdings Inc. (NYSE:GNRC) jumped 9.35 percent after the maker of engine powered products increased its forecast for the full year, citing higher demand for home standby and portable generators.
Anworth Mortgage Asset Corp. (NYSE:ANH) shed 3.24 percent. The company declared a dividend of $0.15 per share for the third quarter of 2012 versus a dividend of $0.18 per share for the second quarter, down 17 percent.
European markets closed sharply higher after the results of Spain's bank stress tests on Friday. Germany's DAX added 1.53 percent to close at 7,326.73. France's CAC40 gained 2.39 percent to finish at 3,434.98. U.K.'s FTSE 100 rose 1.37 percent to end at 5,820.45. An independent audit showed that Spanish banks face a shortfall of 59.3 billion euros ($76.2 billion), less than prior estimates of around 60 billion euros. Spain commissioned the stress tests as part of a pre-condition for a potential 100 billion euro bailout package for its banking system.
Among Asian markets, Japan's Nikkei 225 fell 0.83 percent to end at 8,796.51. India's BSE Sensex closed at 18,823.91, up 0.33 percent. China's Shanghai Stock Exchange Composite Index and Hong Kong's Hang Seng Index were closed for public holidays.
Commodity & Currency Scan
Crude oil futures added 0.15 percent to $92.33 per barrel, and natural gas futures surged 4.70 percent to $3.476 per million metric British thermal units. Gold futures inched up 0.17 percent to $1,777.0 per ounce, and silver futures gained 0.49 percent to $34.745 per ounce.
In the currency market, the euro added 0.22 percent against the U.S. dollar to 1.2887. The British pound shed 0.22 percent against the greenback to 1.6131, while the dollar advanced 0.10 percent against the Japanese yen to 78.0200.